BHP in the market for Rio

BHP Billiton has released its half yearly results to 31 December which showed high production levels, leaving the miner feeling confident of a future takeover.

BHP Billiton has released its half yearly results to 31 December which showed high production levels, leaving the miner feeling confident of a future takeover.

Chief Executive Marius Kloppers said BHP was seeking to take advantage of its position of having the strongest balance sheet among major miners while some rivals are weighed down by debt burdens.

Some analysts have suggested the miner is in a good position to take over some of Rio Tinto’s assets, but is in no hurry to act due to the subdued market outlook.

Rio Tinto is scrambling to sell assets to help whittle down its debt load of nearly $39b.

BHP, which dropped a $66b hostile bid for Rio in November, has pre-emptive rights to buy the remaining stake.

BHP posted a 2.2% rise in the first half profits before exceptional items. Cash flow jumped 74% and it was able to cut its already low debt.

“The fact that we have not executed anything means that we probably have not identified opportunities which fit,” Kloppers told a conference call-following the half yearly results.

“But if and when these opportunities arise, we have the capacity to act.”

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